Average life cover claimant aged 58 with average payout ‘insufficient’

THE average life cover claimant last year was 58 years old with €110,755 being the average payout.

This is according to Caledonian Life which said this payout is not nearly sufficient to look after a family for the years to come.

Head of sales and marketing at Caledonian Life, Greg Dyer, said: “The results of the study are worrying, but in keeping with our own observations and research findings that people have insufficient cover to meet their needs.

“At 58 years of age many people in this country may still have dependent children living at home, and a €110,000 lump sum is very little for a family to substitute loss of income of the primary breadwinner. Life insurance policies are intended to provide customers with peace of mind and financial security for their families should the worst happen — they pay out when people need it, but there needs to be a sufficient sum to provide the necessary security.”

Caledonian Life said €100,000 would only last for just over two years, for a family with a requirement of a monthly income of €4,000.

“So the life cover payout is exhausted after this short period of time but the bills will be still there. What is of even further concern, is that almost 15% of claimants were between the ages of 25 to 44, a life stage at which people are often under the most financial pressure with substantial outgoings — mortgages, childcare expenses, running the family home and so on.”

The report found that 1% of claimants last year were between the ages of 25 to 34, while 13% were between 35 and 44. Almost a third were between 44 to 54 with 29% between 55 and 64.

“Industry statistics show that accident is one of the primary causes behind death claims in younger lives, though this changes with cancer and cardiovascular-related conditions becoming more prevalent amongst claimants as the age of the person increases,” said Mr Dyer.